大学课程国际营销Chapter17

大学课程国际营销Chapter17
Chapter 17—Global Pricing
TRUE/FALSE
1. Transfer pricing is the pricing of objects that are sold on the broad market and are transported via rail, auto, truck, or other mechanized system.
ANS: F PTS: 1 DIF: Moderate REF: p. 548
2. Cost-based prices are difficult to manipulate.
ANS: F PTS: 1 DIF: Moderate REF: p. 548
3. The price that unrelated parties would have arrived at for the same transaction, is called competitive parity price, which is one of the philosophies of transfer pricing.
ANS: F PTS: 1 DIF: Moderate REF: p. 549
4. When a performance evaluation is made, transfer pricing policies leading to an inaccurate financial measure of the subsidiary's performance should be taken into account.
ANS: T PTS: 1 DIF: Moderate REF: p. 549
5. Reasonable profit for foreign affiliates has an influence on transfer pricing decisions.
ANS: T PTS: 1 DIF: Moderate REF: p. 549
6. Deriving transfer prices from the market is the most marketing-oriented pricing method because it takes local conditions into account.
ANS: T PTS: 1 DIF: Moderate REF: p. 549
7. High transfer prices on goods shipped into a subsidiary and low prices on goods imported from it will result in minimizing the tax liabilityof a subsidiary operating in a country with high income taxes.
ANS: T PTS: 1 DIF: Moderate REF: p. 550
8. A subsidiary’s financial and competitive position cannot be manipulated by the use of lower transfer prices.
ANS: F PTS: 1 DIF: Moderate REF: p. 550
9. Uncontrolled prices can exist when sales are made by members of a multinational corporation to unrelated parties.
ANS: T PTS: 1 DIF: Moderate REF: p. 551
10. The functional analysis approach is the most applicable approach for transfers of components or unfinished goods to overseas subsidiaries.
ANS: F PTS: 1 DIF: Moderate REF: p. 552
11. The cost-plus approach measures the profits of each of the related companies and compares them with the proportionate contribution to total income of the corporate group.
ANS: F PTS: 1 DIF: Moderate REF: p. 552
12. In highly competitive situations, marketers may be willing to sacrifice immediate earnings for market share gain or maintenance.
ANS: T PTS: 1 DIF: Easy REF: p. 553
13. Pricing changes are static and infrequent when a company's objective is to undersell a major competitor.
ANS: F PTS: 1 DIF: Moderate REF: p. 554
14. Costs are frequently used as a basis for price determination largely because they are easily measured and provide a floor under which prices cannot go in the long term.
ANS: T PTS: 1 DIF: Moderate REF: p. 555
15. A status-conscious market that insists on products with established reputations will be elastic.
ANS: F PTS: 1 DIF: Moderate REF: p. 556
16. Rational approach is a promotion strategy adopted by
the marketer as an adjustment to financial crisis.
ANS: F PTS: 1 DIF: Moderate REF: p. 559
17. In counterpurchase, the participating parties sign a single contract that specifies the goods and services to be exchanged.
ANS: F PTS: 1 DIF: Moderate REF: p. 565
18. Luxurious goods for a country mandating countertrade are less likely to be subject to countertrade requirements than goods that are highly desirable and necessary.
ANS: F PTS: 1 DIF: Moderate REF: p. 566
19. Countertrade cannot be used by corporations as a competitive tool to maintain or increase market share.
ANS: F PTS: 1 DIF: Moderate REF: p. 568
MULTIPLE CHOICE
1. Allocation of resources among the various units of the multinational corporation requires central management to establish the appropriate transfer price to meet all but which of the following objectives?
a. Planning and executing government-mandated ascertainments
b. Reduction of taxes
c. Management of cash flows
d. Minimization of foreign exchange risks
ANS: A PTS: 1 DIF: Moderate REF: p. 548
2. Transfer pricing is described as:
a. the value added to goods and services.
b. selling goods overseas for less than what they are sold for in the exporter's home market.
c. goods which have been imported from another country and priced at twice what they were
sold for in the exporter's home market.
d. the intracorporate pricing of sales to members of the extended corporate family.
ANS: D PTS: 1 DIF: Moderate REF: p. 548
3. Which of the following is one of the influences on transfer pricing decisions?
a. Export restrictions
b. Competition in target countries
c. Environmental constraints
d. Recruitment and training costs
ANS: B PTS: 1 DIF: Moderate REF: p. 549
4. Which of the following is an emerging philosophy of transfer pricing?
a. Cost-based
b. Resource-based
c. Product-based
d. Technology-based
ANS: A PTS: 1 DIF: Moderate REF: p. 549
5. How can the effect of environmental influences on overseas marketers be alleviated?
a. By not shipping products overseas through conventional channels.
b. By manipulating transfer prices in principle.
c. By creating demand in ancillary markets.
d. By encouraging nonuser participation.
ANS: B PTS: 1 DIF: Moderate REF: p. 550
6. When one partner is operating in a low-inflation environment and the other in an environment of rampant inflation, which of the following can be done?
a. Transfer prices can be adjusted for the opposite effects of taxes and duties which is a
delicate balancing act.
b. The effect of environmental influences in overseas markets can be alleviated by manipulating transfer prices at least in principle.
c. Artificial tax-avoidance schemes can be avoided by paying taxes and duties in every
country of operation.
d. Transfer prices can be adjusted to balance the effects of fluctuating currencies.
ANS: D PTS: 1 DIF: Moderate REF: p. 550
7. Which of the following is an internal challenge faced by the transfer pricing policies?
a. The motivation of those affected by the pricing policies of the corporation.
b. Relations between the corporation and tax authorities in host countries.
c. Locating manufacturing facilities in different parts of the world which has high productivity, and low additional costs.
d. Control and coordination of global and regional pricing.
ANS: A PTS: 1 DIF: Moderate REF: p. 550
8. Since 1962, the U.S. government has attempted to stop U.S. companies from shifting U.S. income to their foreign subsidiaries in low- or no-tax jurisdictions and has affirmed ____ as the principal basis for transfer pricing.
a. the cost-plus method
b. offsetting
c. the arm's length standard
d. switch trading
ANS: C PTS: 1 DIF: Moderate REF: p. 551
9. According to Section 482 of the Internal Revenue Code,
which of the following is an arm's length method of pricing?
a. The resale price method
b. The target return price method
c. The value-based price method
d. The proportionally-adjusted pricing method
ANS: A PTS: 1 DIF: Moderate REF: p. 551
10. When competition is keen or expected to increase in the near future, what would cause a product to be more attractive to buyers and the market less attractive to the competition?
a. Penetration pricing
b. Skimming pricing strategy
c. Rigid barriers to entry
d. Low prices
ANS: D PTS: 1 DIF: Moderate REF: p. 554
11. If a company’s objective is to undersell a major competitor, which of the following would be true?
a. Enhanced customer service
b. Frequent price changes
c. Product innovation
d. Intense promotion
ANS: B PTS: 1 DIF: Moderate REF: p. 554
12. Which of the following usually accompanies varying inflation rates?
a. Unemployment
b. Government controls
c. Export measures
d. Recession
ANS: B PTS: 1 DIF: Moderate REF: p. 555
13. Which of the followingsets the price ceiling in a given market?
a. IRS
b. Competitors
c. Demand
d. Prices
ANS: C PTS: 1 DIF: Easy REF: p. 556
14. If cost structures change, the global marketer must understand which of the following to determine appropriate price levels?
a. Price inelasticity of market demand
b. Price elasticity of consumer demand
c. Price elasticity of market demand
d. Price inelasticity of consumer demand
ANS: B PTS: 1 DIF: Moderate REF: p. 556
15. The marketer’s freedom in making pricing decisions is closely tied to which of the following?
a. The product category into which the product fits in and the targeted segment.
b. The cost incurred in the product development process and the profit margins.
c. The customer perceptions of the product offering and the marketing communication tied toit.
d. The benefits the product offers to the consumer and consumer's income level.
ANS: C PTS: 1 DIF: Moderate REF: p. 556
16. In general, company representatives can cite all of the following consequences in arguing against price controls except:
a. noninflationary wage increases are forestalled.
b. the minimum price often becomes the maximum price if a sector is allowed a price increase, because all businesses in the sector will take it regardless of cost justification.
c. the wage-price spiral advances vigorously in anticipation of controls.
d. labor often turns against restrictions because they are usually accompanied by an income policy or wage restrictions.
ANS: B PTS: 1 DIF: Moderate REF: p. 557
17. Which of the following is a consumer adjustment to financial crisis?
a. More careful decision making
b. Customer loyalty programs
c. Advisory tone
d. Assurances through rational appeals
ANS: A PTS: 1 DIF: Moderate REF: p. 559
18. Which of the following is a shopping adjustment which the consumer makes to deal with financial crisis?
a. Necessities rather than luxuries
b. Switch to cheaper brands or generics
c. Preference for discount stores
d. Local rather than foreign brands
ANS: C PTS: 1 DIF: Moderate REF: p. 559
19. Which of the following is NOT a strategy adopted by the marketer to aid financial crisis?
a. Product strategies
b. Price strategies
c. Process strategies
d. Promotion strategies
ANS: C PTS: 1 DIF: Easy REF: p. 559
20. Which of the following means recasting the product in a new light rather than changing the product itself?
a. Creative positioning
b. Adaptive positioning
c. Cognitive positioning
d. Relative positioning
ANS: B PTS: 1 DIF: Moderate REF: p. 560
21. Marketers who sell to _____ customers have started using standard worldwide pricing.
a. commercial
b. organizational
c. residential
d. external
ANS: B PTS: 1 DIF: Moderate REF: p. 561
22. _____ is a sale that encompasses more than an exchange of goods, services, or ideas for money.
a. Countertrade
b. Forfaiting
c. Factoring
d. Leasing
ANS: A PTS: 1 DIF: Easy REF: p. 562
23. In which form of countertrade does one party agree to supply technology or equipment that enables the other party to produce goods with which the price of the supplied products or technology is repaid?
a. Offset
b. Switch-trading
c. Counterpurchase
d. Buyback
ANS: D PTS: 1 DIF: Moderate REF: p. 565
24. In which of the following can credits ina clearing account be sold or transferred to a third
party?
a. Switch-trading
b. Offset
c. Buyback
d. Counterpurchase
ANS: A PTS: 1 DIF: Moderate REF: p. 566
25. In which of the following is industrial compensation mandated by governments when purchasing defense-related goods and services in order to counterbalance the effect of the purchase on the balance of payments?
a. Counterpurchase
b. Buyback
c. Switch trading
d. Offset
ANS: D PTS: 1 DIF: Moderate REF: p. 566
26. Which of the following is a disadvantage of an in-house countertrade transaction?
a. Less objectivity
b. Higher costs
c. Distanced from customer
d. Less confidentiality
ANS: A PTS: 1 DIF: Moderate REF: p. 567
SHORT ANSWER
1. What are the three philosophies of transfer pricing?
ANS:
The three philosophies of transfer pricing are: (1) cost-based, (2) market-based, and (3) arm's length price. The rationale for transferring at cost is that it increases the profits of affiliates, and their profitability will eventually benefit the entire corporation. In most cases, cost-plus is used, requiring every affiliate to be a profit center.
PTS: 1 DIF: Moderate REF: p. 549
2. What is a countertrade transaction?
ANS:
Countertrade is a sale that encompasses more than an exchange of goods, services, or ideas for money. In the international market, countertrade transactions are those transactions which have as a basic characteristic a linkage, legal or otherwise, between exports and imports of goods or services in addition to, or in place of, financial settlements. Historically, countertrade was mainly conducted in the form of barter, which is the direct exchange of goods of approximately equal value, with no money involved. These transactions were the very essence of business at times when no money existed or was available. Over time, money emerged to unlink transaction from individual parties and permit greater flexibility in trading activities.
PTS: 1 DIF: Moderate REF: p. 562-563
3. What is one thing that the price element of the marketing mix creates that the other three
elements do not?
ANS:
In a world of increasing competition, government regulation, accelerating inflation, and widely fluctuating exchange rates, global marketers must spend increasing amounts of time planning the pricing strategy. Because pricing is the only revenue-generating element of the marketing mix, its role in meeting corporate objectives is enhanced. However, it comes under increasing governmental scrutiny as well, as evidenced by intracompany transfer pricing.
PTS: 1 DIF: Moderate REF: p. 568。